New water tariff formula to be announced by year-end 

• Minister Thondaman says new formula will enhance transparency and accountability
• Stresses Govt. is pursuing aggressive reforms in the water sector 
• Claims recent hike was not a political move and was a necessity 

Water Supply and Estate Infrastructure Development Minister Jeevan Thondaman yesterday announced that the Ministry will introduce a new tariff guideline and formula for water tariffs by the end of 2023. 

“We will introduce a new tariff guideline and formula by the end of this year. This will enhance transparency and accountability in the water tariff structure,” he said via Twitter.  The Minister said the Government is also pursuing aggressive reforms in the water sector and the Water Board.New water...

 “This includes introducing lean management practices, setting measurable KPIs for the organisation and adopting a cost optimisation strategy to give greater value for money to consumers,” Thondaman said. 

“We are also formulating a new water safety plan, a rainwater harvesting scheme and a climate resilience roadmap to ensure a consistent supply of clean, drinking water. We remain committed to creating a better, more efficient water supply and management system,” he added. 

Clarifying the reasons behind the recent decision to increase water tariffs Thondaman denied the move was political and was instead an essential step to secure the financial independence of the Water Board. 

The Minister said that while an average Water Board customer consumes 13.5 units per month this would result in a monthly bill of Rs. 1300 under the revised tariff. He also noted there will be no tariff increase for Samurdhi and tenement customers. “We are committed to protecting them from the burden of increased tariffs as we come out of this difficult economic situation,” he said. 

“Due to rising costs, including electricity tariffs, raw materials, currency depreciation, and high-interest rates, the cost of providing one unit of water has surged to Rs. 130. It was no longer possible to provide clean and safe piped water to the Water Board’s customers at the previous tariff. Continuing losses would have led to water services being crippled across the country benefitting no one,” he said. 

The Minister said however the authorities have structured the new tariffs to alleviate the impact on lower-end users while ensuring fairness in the distribution of costs. “Only consumers using more than 20 units of water a month would start paying the actual unit cost and more. Around 70% of the Water Board’s customers fall below this threshold,” he noted. 

The Minister also highlighted that while the Water Board serves only 50% of the population the remainder of Sri Lanka’s population is served through community water schemes, municipal councils and groundwater. “Not raising tariffs to meet at least the cost of providing piped water would mean using taxpayer funds to subsidise Water Board consumers. That would just not be fair for the other half of Sri Lanka that is not served by the Water Board,” he added.